Editor’s Note: Robert W. Baird & Co. issued a client newsletter following the April motorhome retail sales report from Statistical Surveys Inc. Excerpts from the Baird newsletter follow.
U.S. motorhome demand was down in April. Motorhome sales fell 6% in April, according to Statistical Surveys. We believe unfavorable weather, elevated gas prices and continued weak consumer confidence put pressure on results in early spring. With dealer inventory near equilibrium, shipments increasingly depend on better retail results to drive the recovery.
• Motorhome retail registrations in the U.S. fell 6% in April. Class A registrations decreased 11%, while Class C registrations fell 2%. The late arrival of spring in most regions likely pressured retail sales in the month. Elevated gas prices and the related effect on consumer confidence were also a headwind.
• Winnebago retail: Through the first two months of the Winnebago quarter ended in May, Winnebago sales were down 11%, versus our full-quarter estimate of plus 10%. So, Winnebago would need a better May, or stronger Canada results to make up for the shortfall. The current trend implies a retail downside near 1,300 units versus our 1,527-unit estimate. Keep in mind, the SSI data is frequently revised upward, which would close this gap.
• Dealer inventory: Motorhome dealer inventory bottomed a year ago, and in 2010 wholesale unit shipments outpaced retail sales by roughly 6%. Dealers continued to restock in April, as shipments of 2,600 units outpaced retail of 2,200 units.
• Important note. Data for certain months is incomplete due to reporting delays from Maine and Minnesota. We caution against attaching undue significance to data from a single month. The data tend to fluctuate from month to month, and are frequently revised.
This summary of a Baird research report is not intended as investment advice. To participate in Baird surveys and receive research reports, contact Craig R. Kennison, CFA, at firstname.lastname@example.org.